By Cyndie Shearing
Spring planting season has arrived (or is just around the corner) for farmers across the country, who are confronting growing uncertainty around one of their most essential crop inputs: fertilizer. Recent disruptions to global fertilizer markets and major shipping routes are raising concerns. It’s yet another stressor on farmers who are already being squeezed as input costs remain historically high while prices for many commodities have fallen significantly.
Large volumes of urea, ammonia, phosphates, sulfur and petroleum produced in Gulf countries move through the Strait of Hormuz, the narrow waterway that provides the only sea passage from the Persian Gulf to the open ocean. Analysis by American Farm Bureau economists reveals that countries exposed to disruption in the region account for nearly half of all global urea exports and about 30% of global ammonia exports, reflecting the concentration of fertilizer production and export capacity in and near the Persian Gulf.
Simply put, the situation is serious.
American agriculture depends on a stable and affordable supply of fertilizer to remain productive and competitive.
Harry Ott, president of South Carolina Farm Bureau and a cotton, corn and soybean farmer, recently shared an alarming experience. When he contacted a fertilizer supplier to place an order, he was initially told pricing information for the in-stock product he needed was not available, as the supplier was waiting to see “how high” wholesale prices for future deliveries would go. We understand suppliers are going to experience higher costs, too, but the hope of every farmer in the country is that suppliers don’t take advantage of the situation to unnecessarily inflate prices.
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